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Friday, 11 May, 2001, 06:36 GMT

Labour 'not to raise tax'

The Labour Party will repeat its pledge not to raise income tax rates, according to newspaper reports.

The manifesto, agreed at a joint meeting of cabinet ministers and the party's national executive committee on Thursday, is due to be published next week.

The pledge comes despite pressure within the party to keep the option of tax rises open if they are needed to pay for better public services, according to the Guardian and Independent newspapers.

" A radical and forward looking manifesto which will show the dividing lines between Labour and the Conservatives "
John Reid
Northern Ireland Secretary

Chancellor Gordon Brown has attacked Tory plans to cut taxes while declining to confirm that Labour would not put taxes up in a second term.

The Guardian reported that the manifesto would call for wide consultation by President George W Bush for his national missile defence system.

The paper also said Labour will offer a free vote on foxhunting with a wording that implies the use of the parliament act to overcome opposition in the Lords.

Other clauses cover single currency assessments, a commitment to local referenda on regional assemblies and a review of employment legislation.

Dividing lines

The manifesto was agreed without a vote and divides Labour's programme into 25 steps covering 10 goals in five chapters, it was reported.

The meeting at Labour's London headquarters, attended by Tony Blair, followed the launch of the Conservative Party manifesto on Thursday morning.

Afterwards, Northern Ireland Secretary John Reid said Labour had produced a radical and forward looking manifesto that would show the clear dividing lines between it and the Conservatives.

But he refused to say whether the manifesto would renew Labour's pledge at the last election not to raise the basic rate of income tax.

And it is the growing war over taxation and spending plans that are likely to generate the most notable skirmishes of the early campaign.

Economic record

Dr Reid said that in contrast to the Tory plans, Labour's manifesto was believable.

Earlier, Tony Blair had put the government's record on the economy at the heart of his pitch to the electorate.

Speaking at Labour's first morning news conference of the election campaign, he said that hard won economic stability under Labour underlined the "fundamental choice" faced by voters.

He insisted that Britain was far stronger than when Labour came to office.

And he gave short shrift to Tory plans to cut tax on fuel, saying the they were unaffordable without slashing public spending or raising debt.

Economic credibility was the single most important requirement for government, continued Mr Blair.

"In the past no-one doubted our compassion and our passion, indeed, for social justice.

"But some doubted our ability to run the economy, to be put in charge of peoples money, their jobs, their livelihoods.

"This has changed ... the Labour party enters this election as the party of economic stability and competence."

Hard choices

Mr Blair acknowledged that the first two years of tough spending plans had meant hard choices over public expenditure.

But he insisted that this had laid the foundations for current economic stability.

The lowest interest rates for 35 years had helped hard-working families with their mortgages.

" If the Tories have the economy wrong, they can't get anything else right "
Tony Blair

In the 1980s, the Tories thought they could rely on "some claim to economic stability", he argued.

"The last recession lost it for them.

"Nothing they have done since has got it back."

But shadow chancellor Michael Portillo attacked Labour's record in government, branding its spending plans as "unsustainable".

"Another Labour government would imply an unsustainable commitment to government spending which could only be matched by higher taxes," he said.

But Chancellor Gordon Brown retaliated - saying that Tory plans were "irresponsible" and would put Britain's economic stability at risk.

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